Specified Investment Flow-Through Trust (SIFT)

A type of income trust that holds publicly traded investments, has at least one non-portfolio property, and is resident in Canada. SIFT trusts are a common type of business structure in Canada. The trusts were intended to provide tax advantages for non-commercial investments, but became widely used by commercial businesses. The United States and Australia formerly had similar business entities.

The Canadian government decided that the tax advantages businesses had by using SIFT trusts as opposed to a corporate structure were "not appropriate", and in October 2006 enacted a tax fairness plan that included a provision for taxing distributions on publicly traded income trusts. The provisions went into effect for preexisting income trusts beginning January 1, 2011, and for new income trusts (after October 2006) beginning January 1, 2007. Many preexisting SIFT trusts decided to convert to a corporate ownership structure because of these changes to the tax law.


Investment dictionary. . 2012.

Look at other dictionaries:

  • Specified Investment Flow-Through Tax - SIFT — A tax implemented by the Canadian government on the distributions of a special type of Canadian income trust. SIFT trusts was a common business structure in Canada that provided beneficial tax advantages prior to 2006. They are actively managed… …   Investment dictionary

  • Real estate investment trust — A real estate investment trust or REIT (  /ˈriːt …   Wikipedia

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